Buffalo Wild Wings franchisee Diversified Restaurant Holdings has agreed to be acquired by the private equity firm ICV Partners in an all-cash deal valued at $130 million.
The $1.05-per-share price exceeds the value of Diversified’s common shares at the end of trading on Nov. 5 by 123%, according to the deal participants. They noted that the purchase includes the assumption of debt and transaction expenses. The acquisition has been structured as a merger with a newly formed affiliate of ICV.
With 64 units spread across five states, Diversified is one of Buffalo Wild Wings’ largest franchisees. The brand was acquired last year by Inspire Brands, which is also the parent of Arby’s, Sonic and Jimmy John’s.
“These are exciting times for the Buffalo Wild Wings brand,” said Michael Ansley, Diversified’s acting CEO and executive chairman. “Inspire Brands has reignited the sports bars with an improved menu, better customer experience and strong support for its franchisees. With the strength of ICV, our franchise can better leverage this effort and further the long history of BWW customer loyalty.”
Ansley and Jason Curtis collectively hold about 34% of Diversified’s outstanding shares. The two have entered into an agreement to sell their shares at the price tendered by ICV.
The deal is still subject to approval by Buffalo Wild Wings and a majority of Diversified shareholders, who will be asked to vote yea or nay at their annual meeting. The acquisition is expected to be completed by no later than early next year.
ICV is an investor in lower middle-market companies.
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